The market is nervous as Ethereum continues to rise, with over $835 million in short positions ready to be liquidated if ETH reaches $4,000. The price chart for Ethereum and the provided liquidation heatmap demonstrate the high stakes that are currently surrounding the second-largest cryptocurrency. Significant groups of brief liquidations between $3,800 and $4,000 are visible on the liquidation map.
The cumulative short liquidations jumped sharply at $4,000, indicating a significant price milestone that, if broken, could have a domino effect. With so many traders betting against ETH’s bullish trend, the sheer volume of possible liquidations suggests increased market leverage. These liquidations may serve as fuel if Ethereum keeps rising, causing the price to soar above $4,000.
There is a noticeable upward trend on the Ethereum daily chart. ETH has shown increasing bullish sentiment by establishing strong support levels close to $3,300 and $3,500, after breaking above $3,200. The positive momentum is confirmed by key moving averages, such as the 50, 100 and 200 EMAs, all of which are pointing upward. Early November saw a rally following the breakout from a consolidation phase, and the current price of $3,565 is still just below testing resistance at $3,800.
Investors should keep an eye on two important levels. The first short-term price movement may be determined by the $3,800 resistance. If Ethereum breaks out above this level, it may test $4,000, where significant short liquidations could support the rally. A crucial support level on the downside is $3,300.
A violation here could indicate that a correction is about to start. Ethereum’s rise to $4,000 is accompanied by rising volatility.
There may be a substantial squeeze if the price rises above the $4,000 mark, which might push ETH higher. The market’s response to these liquidation levels, however, may cause significant price swings in either direction, so staying cautious is the key.